Japan to introduce Residency Program for angel investors to boost startup investment

Japan plans to offer residency lasting up to five years to angel investors in a bid to bring in much-needed investment money for the country's startups, says a report by Nikkei Asia.

The new residency status will be available as soon as next fiscal year, which begins in April, says the report. The residency visa will apply to 13 national strategic special zones.

Conditions for residency:


The requirements for obtaining residency will involve investment proposals, the investor's past performance, and the level of assets owned. Details regarding these criteria, such as investment thresholds, will be decided at a later date.

To prevent money laundering and other crimes, local authorities overseeing the strategic special zones will be mandated to certify and perform oversight on angel investors, says the report.

Moreover, Residency holders will also need to participate in activities aimed at fostering startup growth, such as providing corporate advice.

In October last year, Tokyo's Shibuya ward submitted a proposal to create a residency program for angel investors.

The government looks to implement Shibuya's plan not just to the ward but to all strategic special zones.

Total venture capital investment in Japan came to 270.6 billion yen ($1.82 billion) in fiscal 2018, according to Mizuho Research & Technologies. That is 2.3 times higher than fiscal 2014, but falls well short of the equivalent of 14.4 trillion yen worth of VC funding in the U.S.

Japan aims to leverage startup investment expertise via the upcoming residency initiative, which will draw inspiration from similar programs implemented in other nations. For instance, in the United States, immigrant investors can secure a pathway to permanent residency by investing $800,000 or higher in regions with unemployment rates 50% higher than the national average.